Intellectual property can carry a significant amount of value. A brand can be distinguished by and build a reputation on its trademarks, and copyrights and patents can be a major source of income.

When any of these forms of intellectual property are infringed upon, legal action can be taken to stop the illegal use and recover compensation for damages suffered.

If its owner is willing, one can also license intellectual property. In its most basic terms, a license is a contract that allows one party to act under the legal rights afforded to another. So, for example, the patent holder of a new software system can retain rights to the program but license it to others for a fee. The party that licensed the software can then use it for its business purposes, but only subject to the terms of the agreed upon licensing contract. Under these circumstances, both parties benefit from such an agreement.

There are many shapes that these licensing agreements can take. There may be a situation where the parties want to license intellectual property from each other with payment for the licenses correlating to a difference in the value in the intellectual property involved. Other situations may warrant a royalty agreement where the success of the license dictates the payment received by the licensing party. Many situations justify a license that is paid for up front for a specified price.

Regardless of the intellectual property involved, licensing can be a sound way to secure profits. On the other side of the equation, those looking to expand their business can often benefit from licensing existing intellectual property. To learn more about this process and better ensure that licensing agreements are detailed and negotiated in fairness, individuals and businesses should turn to attorneys who are experienced in this area of the law.